Issuance strategy

Domestic borrowing

According to the May Economic Survey, the central government’s financing requirement in 2021 is expected to be kr. 307 billion, of which about half stems from redemption of the short-term issuances, which has primarily been used to finance temporary covid-19 measures.

The target for sales of government bonds in 2021 is kr. 110 billion at market value. The remainder of the financing requirement will be covered via T-bills, Commercial Papers (CP) and by drawing on the central government’s account.

Financing requirement 2021

Financing requirementbillion
Net financing requirement54
Social housing19
Redemption bonds etc.
82
​Redemption T-bills83
​Redemption commercial papers​70
Financing requirement307
Note: Redemption bonds etc. includes redemptions and buy-backs of government bonds, payments from the central government in currency swaps and net purchases of government funds.     


In the 2nd half of the year, the 2-year and 10-year nominal on-the-run issues will be offered at all ordinary auctions and can be supplemented with the 10-year inflation-linked bond or the 5-year or 30-year nominal bond if deemed fit. Focus will continue to be on issuance in the new 2-year and 10-year nominal bonds that were opened in the 1st half of the year, which reflects the strategy to build volume in these bonds to the levels of liquid benchmark series.

With the current estimate of the government’s financing requirement, the total outstanding amount of T-bills and CP is expected to be kr. 95 billion by the end of 2021, of which up to kr. 60 billion in T-bills. The strategy is still to reduce the outstanding amount of commercial papers as the temporary covid-19 measures are phased out. There are two monthly T-bill auctions, with new 12-month T-bills opened in March, June, September and December. The programme will thus continue to consist of four T-bills expiring within the next 12 months. This contributes to continued flexibility in the issuance policy.